Editorial Notes

[Editorial Notes] Baghjan blowout: Need to fix liabilities

The impact of blowout in Baghjan oil well, followed by fire is threatening on the ecology of the sensitive region. The incident highlights the need for a stronger regulatory framework and fixing liability.
By IASToppers
June 22, 2020

Baghjan blowout: Need to fix liabilities

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Introduction:

After nearly two weeks of uncontrolled leakage at an oil well in Upper Assam’s Baghjan village, a massive explosion followed by fire is engulfing the area. While some people lost life, more than 7,000 people from three villages — Baghjan, Dighaltarang TE and Dighaltarang are affected by the incident and are now living in relief camps.

Series of events:

  • The natural gas well at Baghjan belonging to Oil India Ltd (OIL) in Upper Assam’s Tinsukia district that had been leaking gas since May 27, caught fire on June 9, 2020.
  • According to OIL, the fire will take at least four weeks to control.
  • According to the Oil Industry Safety Directorate, eight accidents in oil and gas installations took place between April and June 1, 2020.
  • Such accidents are a grave reminder of the inadequate safety measures and the lackadaisical implementation of safety standards at oil and gas installations in the country.

Damage:

  • The fire and condensate spillage has damaged farmlands, tea estates and has threatened the wildlife and aquatic species in the eco-sensitive area.
  • The oil well lies within a 10-kilometre radius of the Dibru Saikhowa National Park and Bherjan-Borajan-Podumoni Wildlife Sanctuary, besides being right next to the Maguri-Motapung wetland (1 km from the site) — an Important Bird Area (IBA).
  • Despite the sensitive location, the project received a clearance from the Union environment ministry.
  • In fact, recently, the ministry also gave clearance to Oil India Ltd for drilling inside the Dibru Saikhowa National Park at seven locations.

Fixing liability:

  • After the incident, the next logical step would be to limit damages, clean up the spill and establish liability.
  • The principle of ‘absolute liability’ laid down by the Supreme Court in 1986, in the MC Mehta vs Union of India decisions (or the Oleum Gas Leak Case) needs to be recounted here.
  • For many centuries, liability in law centered around the concept of ‘fault’ — i.e. some form of a shortcoming in the conduct of the polluting party.
  • This meant that to affix liability, it had to be shown that the polluting party had done it deliberately; or due to negligence in action.
  • ‘Fault’, in this sense, was notoriously difficult to establish as one had to have evidence to demonstrate on whose part the shortcomings lay.

1. Strict liability:

  • To overcome the limitations of this approach the courts framed the principle of strict liability— where there was no need to establish fault.
  • The rule was that any entity that engaged in activities that were dangerous, could be held liable, if any accidents were caused, irrespective of any fault on their part.
  • There were some exceptions, like if the damage was caused by circumstances beyond the control of the entity (an act of God); or that third parties not connected to the entity had caused the accident; or that the person who suffered the injury had consented to that act.
  • These exceptions often made strict liability not effective enough and led to situations where it was difficult to ascertain who had to pay for the losses.

2. Absolute liability:

  • The Supreme Court propounded a new principle — principle of absolute liability.
  • The court held that entities that engaged in hazardous / inherently dangerous activities had an absolute and inexcusable duty towards the community to prevent any harm.
  • The enterprise must be absolutely liable to compensate for such harm and there should be no answer to the enterprise to say that it had taken all reasonable care and that the harm occurred without any negligence on its part. [MC Mehta vs Union of India]
  • For all the activities that were inherently hazardous (such as oil drilling), there was an absolute liability to pay for losses if things went wrong and there were no exceptions to this.

Legislations in India:

  • In 2010, Parliament enacted the National Green Tribunal (NGT) Act, which set up the NGT — an exclusive environmental court to deal with environmental matters.
  • However, Parliament chose to ignore absolute liability and the standard of liability is at best a strict one and not an absolute one.
  • The constitutional courts of our country can continue to apply the standard of absolute liability.
  • The Supreme Court and High Courts can continue to exercise jurisdiction over environmental matters despite the NGT.
  • This is because the right to environment has been declared to be an aspect of Article 21 (the Right to Life) and the writ jurisdiction can be invoked to address and respond to violations.
  • Further, there is also the principle of ‘polluter pays’ — which is that the entity that caused the environmental damage must pay for the cleanup and should compensate the losses.

Need for a stronger regulatory framework:

  • Most regulations and legislations in the country relating to blowouts and oil spills, focus on spills that occur in the marine environment.
  • The Merchant Shipping Act, 1958, and The Merchant Shipping Rules, 1974, deal with spills, leakages and discharge from vessels in the sea and miss out cases of inland oil spills and blowouts.
  • Oil spills fall within the scope of The Disaster Management Act (DMA), 2005, however, this framework is only a responsive one, leaving no institutional-regulatory mechanism to deal with an oil spill and a regulatory gap exists.
  • In spite of having so many inland spills, there is no proper regulation or legislation in this regard.
  • The recommendations of MB Lal Committee constituted in 2009, has not been implemented yet. One of its recommendations — of building emergency response centres to handle major oil fires, was to be completed in 2014, but is still not implemented.

Conclusion:

Looking at the fact that such instances are common in India, there is a necessity to enact a specific legislation in this regard — which would provide for a rule to affix liabilities, ensure safety concerns, compliance of the environmental norms and addresses the questions of the costs of cleaning up and compensation.

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